Russia's Dixy Group will spend US$25.5m on a marketing overhaul that will look to boost the group's brand identity.

At a launch event in Moscow last night (30 May), the company said it would redesign its stores and roll out a Russia-wide advertising campaign to solidify its identity as a "friendly" neighbourhood supermarket.

"Our new marketing strategy that we are presenting to you today is very reflective of our core values and beliefs," Dixy president Ilya Yakubson revealed. "We want to be a bright example. Open, honest, friendly neighbours."

Shannon Cullum, CEO of Dixy's partner Saatchi & Saatchi Russia, said the new marketing strategy could change the face of Russian food retail by increasing the importance of branding.

Russian retailers have traditionally focused on raising awareness of product sales, but little has been done to build strong brands, especially in the lower-priced stores, Cullum said.

"I think what we'll see now more and more in Russian retail is a lot more brands focusing less on the short term, tactical sales promotion and you'll see more branding," he said. "Dixy has a huge advantage of being one of the first - I won't say the first - but one of the first to take a truly long-term view of what their brand stands for."

Dixy is one of Russia's largest food retailers with 664 stores in five regions. More than 100 stores will undergo a redesign this year with 300 more stores slated for redesign next year. The company plans to complete work on all stores by 2013, said Dixy marketing director Danny Perekalsky. The remodelling, which will cost RUB1m (US$35,000) per store, will change the interiors, sign boards and floor plan.

The company will also spend RUB50m on a new advertising campaign and plans to unveil a new website in July with features that would make it easier for customers to find the closest store and promotions. The company will also introduce more of its brand products over the next quarter to help customers associate with the store, Perekalsky said.

He added: "We understand that a great potential today is in Dixy's positioning, identity: what we are, who we explain to the customer where we are going."

Dixy's new marketing strategy is based on five "blocks": responding to the customers' daily needs, catering to the majority of customers, offering the cheapest food basket in an area, ensuring quality and connecting to communities.